China has abruptly delayed the release of key economic data, one day ahead of its scheduled release, as the ruling Communist Party gathers for a major political meeting amid a faltering economy.
The country̵[ads1]7;s National Bureau of Statistics updated its timetable on Monday, with the dates for a number of economic indicators – including the closely watched GDP growth – marked as “delayed”. The indicators, which were scheduled to be released on Tuesday, also include quarterly retail sales, industrial production and monthly unemployment rates.
The agency did not give a reason for the delay or set a new publication date.
Separately, the country’s customs authority has also postponed the release of monthly trade data, which was originally scheduled to come out on Friday.
The delay in the highly anticipated data coincides with the week-long 20th National Congress of the Communist Party in Beijing, where Chinese leader Xi Jinping is expected to secure a record-breaking third term in power. Priorities presented at the gathering will also set China’s trajectory for at least the next five years.
“The delay suggests the government believes the 20th Party Congress is the most important thing happening in China right now and wants to avoid other information flows that could create mixed messages,” said Iris Pang, chief economist for Greater China at ING Group. , in a research note on Tuesday.
Other analysts think it could be because the data sets aren’t pretty.
“My forecast is a further decline of 1.2% [on a quarterly basis for China’s GDP]. This would mean that China had joined the US in a technical recession, says Clifford Bennett, chief economist at ACY Securities.
The delay would make sense “from an imaging perspective,” he said. Some economists call two consecutive quarters of contraction a technical recession.
China’s GDP fell 2.6% in the second quarter from the previous one, reversing growth of 1.4% in the January to March period. On an annual basis, the economy increased by 0.4% in the second quarter.
Analysts have widely expected growth in the third quarter to remain weak, as severe Covid curbs, a deepening crisis in real estate and slowing global demand continue to weigh on the economy.
Economists polled by Reuters had expected China’s GDP to grow 3.4% in the third quarter from a year earlier. That would fall far short of the government’s full-year growth target of around 5.5%.
Many international organizations, including the IMF and the World Bank, have recently downgraded China’s GDP growth forecasts for this year.
Bennett expected third-quarter GDP data to be released after the party congress.
“When the release happens, we should all be prepared for some global financial market reactions if the world’s two largest economies are both in recession this year,” he said.
China’s economy is facing increasing challenges. Growth has stopped, youth unemployment is at a record high, and the housing market is in shambles. Constant Covid shutdowns have not only wreaked havoc on the economy, but also triggered growing social discontent.
In the 20th Party Congress report released on Sunday, Xi renewed his pledge to grow China into a “medium developed country” by 2035.
That would mean China would have to grow at an average growth rate of about 4.7% a year from 2021 to 2035, according to Larry Hu, chief China economist for Macquarie Group.
Hu added that the target may be difficult to achieve as the economy faces several structural headwinds, such as the real estate slump, an aging population and rising tensions between the US and China.